Introducing the APN Steller Development Fund
For wholesale, sophisticated investors only

The APN Steller Development Fund will develop six inner Melbourne medium density
apartment projects targeting the strong demand from existing home owners who are
looking to release equity and move into large affordable apartments.

Steller is a full service property development and construction company, which specialises
in delivering oversized apartments that cater for the growing downsizer baby boomer
market, with a particular focus on owner occupiers. With an established reputation
for quality, Steller has completed a pipeline of projects in excess of $500 million
since 2006.

The Fund is forecast to deliver

Development partnership with Steller Group, which has established a specialised,
low cost, development and construction delivery capacity.

No debt at the Fund level; construction funding on a non recourse basis at an individual
Project level only.

Capital at risk minimised through requiring end apartment sales to cover costs before
construction commences.

Key features

Structure

Unregistered managed investment scheme

Investment term

7 years, with Seed Projects to be developed over 4-5 years

Application

Minimum $500,000 (subject to APN’s discretion), 40% payable at time of application

Investor type

Wholesale Clients (as defined in the Corporations Act) in Australia

Fund size

$20 million in initial equity targeted

APN co-investment

$2 million on the same terms and conditions as investors

Trustee & Manager

APN Funds Management Limited

Risk mitigation

Structured to minimise capital at risk to initial site purchases before apartment
pre-sales are achieved.

Medium density only projects located in Residential Growth zones in close proximity
to transport and amenity.

Planning risk mitigated further with each project already in planning.

Construction time / risk is mitigated given relatively small size of each project
and the strict cost parameters supported by Guaranteed Maximum Price build by Steller
based on Quantity Surveyor certifications.

Sales risk is mitigated given relatively small size of each project and delivery
parameters that pre-sales must cover a minimum of project debt before construction
commences.

The sale assumptions are reasonable with affordable apartment pricing at ~$8,000
psm on average with strong demand from target market downsizing owner occupiers.

Land value supported by independent valuations.

Steller delivery guarantee – any capital losses on a project are guaranteed 50 cents
in the dollar by Steller.

Steller, as the Joint Venture partner has considerable specific experience and expertise
along with a demonstrated track record.

NB - All capitalised terms are referenced in the Information Memorandum (IM).

Further information

Click here
to request a copy of the Information Memorandum or contact
Huey Tran on (03) 8656 1087 or by email at htran@apngroup.com.au
to discuss further.

Initial target investment rate of return. This target will be subject to property,
financing and other general risks. Any target return will not be guaranteed. Returns
are pre tax and post fees.

Forecast number of apartments. The number of apartments may change during the delivery
of each Project.

After payment of fees and Steller Development Profit Share, and before tax.

The information has been prepared without taking into account your objectives, financial
situation or needs and you should consider if the information is appropriate for
you before making an investment decision. Before making any investment decision
on the basis of any information provided you must read the relevant Information
Memorandum (IM) issued by APN Funds Management Limited (APN) and make your own investigations
regarding the accuracy, reliability and completeness of this information. The IM
referred to can be downloaded via "register
your interest" or by contacting APN on (03) 8656 1000. You should consider
the IM for APN’s financial products before making a decision about APN’s financial
products. All views expressed and all projections, forecasts or statements relating
to expectations regarding future events or possible future performance of the Fund
represent APNFM’s and Development Manager’s assessment and interpretation of information
available as at the date of the IM (6 July 2015). No representation is made or assurance
given that such statements views, projections or forecast are reasonable or correct
or that the objectives or prospective returns of the Fund will be achieved. Recipients
and intending investors must determine for themselves what reliance (if any) they
should place on such statements, views, projections or forecasts and no responsibility
is accepted by the APN Steller JV Group. Intending investors are strongly advised
to conduct their own due diligence.